$2.8 billion in ACA subsidies

...paid to insurers during the first four months these payments were made under the reform law lacked proper internal controls at CMS to ensure their accuracy, according to the HHS Office of Inspector General.

"I wouldn't say that employers are on the fence about private exchanges.

... Large national employers understand their potential, and they are looking at all strategies that will allow them to cut costs and bend medical trend. Adoption continues to grow, but we have not yet reaching the tipping point. I'd be surprised at any sort of dramatically large uptick [in 2016]."

— Chris Bernene, a partner in Oliver Wyman's Health and Life Sciences practice, told AIS's Inside Health Insurance Exchanges.

75% of health exchange

...enrollees who tried to find a doctor found it easy or somewhat easy, and 67% were able to schedule an appointment within two weeks, according to the latest tracking survey from The Commonwealth Fund.

Aetna to buy Humana for $37 billion in cash and stock

Bloomberg

Phil Serafino and Ed Hammond

Aetna Inc. agreed to buy Humana Inc., the second-largest provider of private Medicare insurance, for $37 billion in cash and stock to broaden its health care coverage.

The transaction values Humana at $230 a share based on yesterday’s closing price for Hartford, Connecticut-based Aetna, the companies said in a statement Friday. That’s 23 percent above Louisville, Kentucky-based Humana’s last close.

The acquisition is part of a merger frenzy as the five biggest U.S. health insurers look to get bigger. The law known as Obamacare spurred deals by introducing rules that push insurers to look for savings, and by creating millions of new customers. Humana’s 3.2 million Medicare Advantage members made it a target: it’s winning new business as more Americans turn 65 and become eligible for the health program for the elderly and its private insurer-run version.

“Medicare Advantage is a coveted space,” Michael Bernstein, a partner at Baird Capital’s U.S. private equity team who focuses on health care, said in an interview before the transaction was announced. “To develop a similar scale in Medicare would take a great deal of work and time, which would be bypassed by making that transaction happen.”

Terms of Deal

Humana shareholders will receive $125 in cash and 0.8375 of an Aetna share for each of Humana’s. The companies expect the deal to close in the second half of 2016. Aetna Chief Executive Officer Mark Bertolini will be chairman and CEO of the combined company.

Aetna fell 2.6 percent yesterday to close at $125.51 in New York trading, while Humana dropped 2.9 percent to $187.50. U.S. financial markets are closed today for the Independence Day holiday. The companies plan a conference call Monday at 8:30 a.m. New York time to discuss the deal.

The transaction values Humana at about 10 times earnings before interest, tax, depreciation and amortization, according to data compiled by Bloomberg. That’s below the median valuation of 11.4 times for similar deals, the data show.

The deal is also poised to be the biggest ever in the health-insurance industry, according to data compiled by Bloomberg.

Still, it may soon be surpassed. Cigna Corp. last month rejected a $47 billion bid from Anthem Inc., saying the offer wasn’t in the best interests of shareholders and Anthem executives weren’t fit to lead a merged insurance giant. And UnitedHealth Group Inc., the biggest insurer, has considered whether to pursue deals with Cigna or Aetna, the Wall Street Journal reported last month.

More Transactions

Centene Corp. said Thursday it agreed to buy Health Net Inc. for about $6.3 billion in a deal that creates the biggest private administrator of Medicaid, the federally funded health program for the poor.

Some of the consolidation has been fueled by the Patient Protection and Affordable Care Act, the formal name of Obamacare. The 2010 overhaul of the U.S. health-care system provides subsidies to help people afford coverage.

A Supreme Court ruling upholding those subsidies for more than 6 million people helped clear the path to dealmaking. The 6-3 decision on June 25 in the King v. Burwell case said the U.S. can continue to give people money to help them buy coverage on the federal healthcare.gov website.

Medicare membership is projected to rise to 68.4 million in 2023, up 26 percent from this year, according to the Centers for Medicare & Medicaid Services. Humana covers more than 14 million people through commercial, Medicare and Medicaid plans.

Citigroup Inc. and Lazard Ltd. provided financial advice to Aetna, while Davis Polk & Wardwell LLP is acting as legal adviser. Goldman Sachs Group Inc. gave financial advice to Humana and Fried, Frank, Harris, Shriver & Jacobson LLP is its legal adviser.

 

http://www.msn.com/en-us/money/companies/aetna-to-buy-humana-for-dollar37-billion-in-cash-and-stock/ar-AAcvCVz

How Medicare is affected by marriage equality

Section II.b. Enrolling in Original Medicare

Question 11 of 11 (use "Last" or "Next" buttons to see more)

 

In light of the Supreme Court’s rulings that the Defense of Marriage Act was not legal and that same-sex marriages must be issued and honored by all states, there will be changes to Medicare and Social Security rules for same-sex spouses. This means parts of your Social Security and/or Medicare may change. These changes could include the following:

• You can qualify for free Part A  based on your spouse’s working history.
• You can qualify for Social Security Retirement benefits based on your spouse’s working history.
• You can qualify for ESRD-Medicare based on your spouse’s working history.
• You may be able to use your spouse’s group health plan coverage as primary coverage to Medicare, even after you become eligible for Medicare. This means you may be able to delay Part B enrollment.
• You can delay Medicare Part B enrollment without penalty while you are covered by insurance from your spouse’s current employer. 
• You can enroll in Medicare Part B at any time while covered by insurance from your spouse’s current work, and for 8 months after that coverage or work ends, without penalty.
• You can have premium penalties for late enrollment removed or rolled back if you delayed enrollment into Part B because you were covered by insurance from your spouse’s work before you enrolled in Medicare.
• There may be changes to your Part B premiums.
• There may be changes to your Part D premiums.
• There may be changes to your eligibility for Extra Help. 

For some of the benefits listed above, the date and location of your marriage may matter. For a list of states that approve and recognize same-sex marriage, and the applicable dates, see this rule from the Social Security Administration.

Updates to these rules and new instructions are still being released. Social Security has grouped same-sex marriage related questions on SocialSecurity.gov, which can be found here. Medicare.gov has a similar page which can be found here.

For information about other benefits, please see the Frequently Asked Question page on the Gay & Lesbian Alliance Against Defamation (GLAAD) website. For specific information on how overturning DOMA will affect older Americans, please visit the information and resources page on the Services and Advocacy for Gay, Lesbian, Bisexual and Transgender Elders (SAGE) website. This page includes resources for further reading from AARP and other advocates.

If you need assistance understanding how your Medicare or retirement benefits will work now, please contact the Social Security Administration(800-772-1213). Remember, ask for the name of the representative you speak to and get all answers in writing before making any changes to your coverage.

http://www.medicareinteractive.org/page2.php?topic=counselor&page=script&script_id=1780

10 percentage points ...

... was the drop in Part D coverage rates for all prescription opioids from 2012 to 2015, according to a new study from Avalere Health LLC.

According to a recent survey of health executives

73% of respondents said they have seen positive return on investment in new technologies such as wearables that track fitness and vital signs, and other data generated by individual patients.

Source: "Healthcare Industry Must Focus on Training Machines Over the Next Three Years, Accenture Reports," Accenture News Release, June 22, 2015, https://newsroom.accenture.com/news/healthcare-industry-must-focus-on-training-machines-over-the-next-three-years-accenture-reports.htm